Reminder: Your massive property taxes are due

[meadandale]

[quote=flu]Even if the home is free and clear/with no estate taxes,
if the beneficiary really needs to cash at that point when they get the home, they would most likely sell the home right there and then. Very seldomly does someone take the home because they think theuy are getting a killer deal on property taxes, pay say an estate tax on it, and then turn it around and ATM the home to death.[/quote]

I don’t know…a friend of mine is a realtor over here in Allied Gardens. He knows personally of a case where the kids did just this–they inherited a house free and clear and mortgaged it to the hilt, pulling out more and more equity to buy toys and take trips until they ended up under water and finally got foreclosed on.

[bearishgurl]

[quote=CA Renter] . . . if they want the benefit of their parents’ cost basis for property taxes, then they should not be able to step-up the cost basis at death/transfer for capital gains purposes. It should be one or the other. Perhaps people should have a choice when they inherit to either step up the cost basis for all purposes, or leave it at the original cost basis for all purposes.

. . . IMHO, they deserve a home, too, and there is no reason for me or anyone else to feel entitled to take away their right to live in their own family’s home.[/quote]

CA Renter, I agree with your first para. (above) that it should be one or the other (Prop. 13 treatment but with original cost basis or market rate taxes with stepped-up cost basis) upon death, but not both. This (stepped-up basis for capital gains purposes) benefit never occurred to me. This illustrates that owners of Prop. 13-eligible properties have the best of both worlds if they choose to avail themselves.

Re: your second quote, no one is proposing to take away any anyone’s home or property rights. I believe in private property rights, too, to the extent those rights don’t encroach on neighbors. I’m simply proposing that Prop. 13 benefits end with the death of the original owner, period. Property taxes are THE biggest funder of schools, police, fire, libraries, etc. in this state. A percentage of these taxes are protected by Prop 13 from reassessment, indefinitely, as long as title to the real property stays within the family. This, among other issues, is why CA is in such a deep hole, fiscally. I don’t know of any other states that have this perk, worded quite like Prop. 13 is.

To an heir who never had anything all of their lives, inheriting unencumbered real property is like winning the lottery! If an heir with no assets and a low income chooses to move in, not only do they now have a FREE place to live with Prop 13 tax treatment, they can choose to borrow off the property repeatedly and make sporadic payments or just keep borrowing until a lender forecloses, while they let their trees die and fences fall down. This could be several years away, depending on the size of the loan(s). Meanwhile they can qualify for lifeline utility and phone services and even free internet services and bum their neighbors trash cans to avoid paying for pickup. This is DEFINITELY MORE PREFERABLE to selling immediately (selling costs) and taking the cash. Heck, one heir on my block managed to borrow $490K in total before a lender finally foreclosed after almost four years and resold the property for $297K!

I believe if at least the Prop. 58 portion of Prop. 13 were repealed, then these “unqualified-homeowner heirs” I am speaking of here would probably sell immediately upon death and take the cash and run, as they wouldn’t be able to afford the carrying costs of market-rate taxes. The buyers they sell to would then presumably be more qualified as “homeowners.”

[bearishgurl]

[quote=CA Renter] . . . if they want the benefit of their parents’ cost basis for property taxes, then they should not be able to step-up the cost basis at death/transfer for capital gains purposes. It should be one or the other. Perhaps people should have a choice when they inherit to either step up the cost basis for all purposes, or leave it at the original cost basis for all purposes.

. . . IMHO, they deserve a home, too, and there is no reason for me or anyone else to feel entitled to take away their right to live in their own family’s home.[/quote]

CA Renter, I agree with your first para. (above) that it should be one or the other (Prop. 13 treatment but with original cost basis or market rate taxes with stepped-up cost basis) upon death, but not both. This (stepped-up basis for capital gains purposes) benefit never occurred to me. This illustrates that owners of Prop. 13-eligible properties have the best of both worlds if they choose to avail themselves.

Re: your second quote, no one is proposing to take away any anyone’s home or property rights. I believe in private property rights, too, to the extent those rights don’t encroach on neighbors. I’m simply proposing that Prop. 13 benefits end with the death of the original owner, period. Property taxes are THE biggest funder of schools, police, fire, libraries, etc. in this state. A percentage of these taxes are protected by Prop 13 from reassessment, indefinitely, as long as title to the real property stays within the family. This, among other issues, is why CA is in such a deep hole, fiscally. I don’t know of any other states that have this perk, worded quite like Prop. 13 is.

To an heir who never had anything all of their lives, inheriting unencumbered real property is like winning the lottery! If an heir with no assets and a low income chooses to move in, not only do they now have a FREE place to live with Prop 13 tax treatment, they can choose to borrow off the property repeatedly and make sporadic payments or just keep borrowing until a lender forecloses, while they let their trees die and fences fall down. This could be several years away, depending on the size of the loan(s). Meanwhile they can qualify for lifeline utility and phone services and even free internet services and bum their neighbors trash cans to avoid paying for pickup. This is DEFINITELY MORE PREFERABLE to selling immediately (selling costs) and taking the cash. Heck, one heir on my block managed to borrow $490K in total before a lender finally foreclosed after almost four years and resold the property for $297K!

I believe if at least the Prop. 58 portion of Prop. 13 were repealed, then these “unqualified-homeowner heirs” I am speaking of here would probably sell immediately upon death and take the cash and run, as they wouldn’t be able to afford the carrying costs of market-rate taxes. The buyers they sell to would then presumably be more qualified as “homeowners.”

[bearishgurl]

[quote=CA Renter] . . . if they want the benefit of their parents’ cost basis for property taxes, then they should not be able to step-up the cost basis at death/transfer for capital gains purposes. It should be one or the other. Perhaps people should have a choice when they inherit to either step up the cost basis for all purposes, or leave it at the original cost basis for all purposes.

. . . IMHO, they deserve a home, too, and there is no reason for me or anyone else to feel entitled to take away their right to live in their own family’s home.[/quote]

CA Renter, I agree with your first para. (above) that it should be one or the other (Prop. 13 treatment but with original cost basis or market rate taxes with stepped-up cost basis) upon death, but not both. This (stepped-up basis for capital gains purposes) benefit never occurred to me. This illustrates that owners of Prop. 13-eligible properties have the best of both worlds if they choose to avail themselves.

Re: your second quote, no one is proposing to take away any anyone’s home or property rights. I believe in private property rights, too, to the extent those rights don’t encroach on neighbors. I’m simply proposing that Prop. 13 benefits end with the death of the original owner, period. Property taxes are THE biggest funder of schools, police, fire, libraries, etc. in this state. A percentage of these taxes are protected by Prop 13 from reassessment, indefinitely, as long as title to the real property stays within the family. This, among other issues, is why CA is in such a deep hole, fiscally. I don’t know of any other states that have this perk, worded quite like Prop. 13 is.

To an heir who never had anything all of their lives, inheriting unencumbered real property is like winning the lottery! If an heir with no assets and a low income chooses to move in, not only do they now have a FREE place to live with Prop 13 tax treatment, they can choose to borrow off the property repeatedly and make sporadic payments or just keep borrowing until a lender forecloses, while they let their trees die and fences fall down. This could be several years away, depending on the size of the loan(s). Meanwhile they can qualify for lifeline utility and phone services and even free internet services and bum their neighbors trash cans to avoid paying for pickup. This is DEFINITELY MORE PREFERABLE to selling immediately (selling costs) and taking the cash. Heck, one heir on my block managed to borrow $490K in total before a lender finally foreclosed after almost four years and resold the property for $297K!

I believe if at least the Prop. 58 portion of Prop. 13 were repealed, then these “unqualified-homeowner heirs” I am speaking of here would probably sell immediately upon death and take the cash and run, as they wouldn’t be able to afford the carrying costs of market-rate taxes. The buyers they sell to would then presumably be more qualified as “homeowners.”

[bearishgurl]

[quote=CA Renter] . . . if they want the benefit of their parents’ cost basis for property taxes, then they should not be able to step-up the cost basis at death/transfer for capital gains purposes. It should be one or the other. Perhaps people should have a choice when they inherit to either step up the cost basis for all purposes, or leave it at the original cost basis for all purposes.

. . . IMHO, they deserve a home, too, and there is no reason for me or anyone else to feel entitled to take away their right to live in their own family’s home.[/quote]

CA Renter, I agree with your first para. (above) that it should be one or the other (Prop. 13 treatment but with original cost basis or market rate taxes with stepped-up cost basis) upon death, but not both. This (stepped-up basis for capital gains purposes) benefit never occurred to me. This illustrates that owners of Prop. 13-eligible properties have the best of both worlds if they choose to avail themselves.

Re: your second quote, no one is proposing to take away any anyone’s home or property rights. I believe in private property rights, too, to the extent those rights don’t encroach on neighbors. I’m simply proposing that Prop. 13 benefits end with the death of the original owner, period. Property taxes are THE biggest funder of schools, police, fire, libraries, etc. in this state. A percentage of these taxes are protected by Prop 13 from reassessment, indefinitely, as long as title to the real property stays within the family. This, among other issues, is why CA is in such a deep hole, fiscally. I don’t know of any other states that have this perk, worded quite like Prop. 13 is.

To an heir who never had anything all of their lives, inheriting unencumbered real property is like winning the lottery! If an heir with no assets and a low income chooses to move in, not only do they now have a FREE place to live with Prop 13 tax treatment, they can choose to borrow off the property repeatedly and make sporadic payments or just keep borrowing until a lender forecloses, while they let their trees die and fences fall down. This could be several years away, depending on the size of the loan(s). Meanwhile they can qualify for lifeline utility and phone services and even free internet services and bum their neighbors trash cans to avoid paying for pickup. This is DEFINITELY MORE PREFERABLE to selling immediately (selling costs) and taking the cash. Heck, one heir on my block managed to borrow $490K in total before a lender finally foreclosed after almost four years and resold the property for $297K!

I believe if at least the Prop. 58 portion of Prop. 13 were repealed, then these “unqualified-homeowner heirs” I am speaking of here would probably sell immediately upon death and take the cash and run, as they wouldn’t be able to afford the carrying costs of market-rate taxes. The buyers they sell to would then presumably be more qualified as “homeowners.”

[bearishgurl]

[quote=CA Renter] . . . if they want the benefit of their parents’ cost basis for property taxes, then they should not be able to step-up the cost basis at death/transfer for capital gains purposes. It should be one or the other. Perhaps people should have a choice when they inherit to either step up the cost basis for all purposes, or leave it at the original cost basis for all purposes.

. . . IMHO, they deserve a home, too, and there is no reason for me or anyone else to feel entitled to take away their right to live in their own family’s home.[/quote]

CA Renter, I agree with your first para. (above) that it should be one or the other (Prop. 13 treatment but with original cost basis or market rate taxes with stepped-up cost basis) upon death, but not both. This (stepped-up basis for capital gains purposes) benefit never occurred to me. This illustrates that owners of Prop. 13-eligible properties have the best of both worlds if they choose to avail themselves.

Re: your second quote, no one is proposing to take away any anyone’s home or property rights. I believe in private property rights, too, to the extent those rights don’t encroach on neighbors. I’m simply proposing that Prop. 13 benefits end with the death of the original owner, period. Property taxes are THE biggest funder of schools, police, fire, libraries, etc. in this state. A percentage of these taxes are protected by Prop 13 from reassessment, indefinitely, as long as title to the real property stays within the family. This, among other issues, is why CA is in such a deep hole, fiscally. I don’t know of any other states that have this perk, worded quite like Prop. 13 is.

To an heir who never had anything all of their lives, inheriting unencumbered real property is like winning the lottery! If an heir with no assets and a low income chooses to move in, not only do they now have a FREE place to live with Prop 13 tax treatment, they can choose to borrow off the property repeatedly and make sporadic payments or just keep borrowing until a lender forecloses, while they let their trees die and fences fall down. This could be several years away, depending on the size of the loan(s). Meanwhile they can qualify for lifeline utility and phone services and even free internet services and bum their neighbors trash cans to avoid paying for pickup. This is DEFINITELY MORE PREFERABLE to selling immediately (selling costs) and taking the cash. Heck, one heir on my block managed to borrow $490K in total before a lender finally foreclosed after almost four years and resold the property for $297K!

I believe if at least the Prop. 58 portion of Prop. 13 were repealed, then these “unqualified-homeowner heirs” I am speaking of here would probably sell immediately upon death and take the cash and run, as they wouldn’t be able to afford the carrying costs of market-rate taxes. The buyers they sell to would then presumably be more qualified as “homeowners.”

[bearishgurl]

[quote=CA renter]Perhaps that could be dealt with in some other fashion (code enforcement?).[/quote]

CA Renter, calling “Code Enforcement” is of no use. There are only TWO compliance officers in the entire city, which has grown from 53,000 to 285,000 in the last 12 years.

These TWO (hired only two years ago) are each assigned to a list of lenders. Their job is to constantly monitor the exterior condition of foreclosures by dealing with the lenders’ property managers to get pools emptied, weeds mowed, broken windows replaced, etc. 90% of these properties are in recently-annexed portions of CV where they were originally sold for way too much money during the “bubble.”

They care NOTHING about circa 1965 “grandfathered” garages and room additions built too close to property lines, dead trees (unless leaning on a neighbor’s roof), broken down fences, junk vehicles parked on private property, etc.

[bearishgurl]

[quote=CA renter]Perhaps that could be dealt with in some other fashion (code enforcement?).[/quote]

CA Renter, calling “Code Enforcement” is of no use. There are only TWO compliance officers in the entire city, which has grown from 53,000 to 285,000 in the last 12 years.

These TWO (hired only two years ago) are each assigned to a list of lenders. Their job is to constantly monitor the exterior condition of foreclosures by dealing with the lenders’ property managers to get pools emptied, weeds mowed, broken windows replaced, etc. 90% of these properties are in recently-annexed portions of CV where they were originally sold for way too much money during the “bubble.”

They care NOTHING about circa 1965 “grandfathered” garages and room additions built too close to property lines, dead trees (unless leaning on a neighbor’s roof), broken down fences, junk vehicles parked on private property, etc.

[bearishgurl]

[quote=CA renter]Perhaps that could be dealt with in some other fashion (code enforcement?).[/quote]

CA Renter, calling “Code Enforcement” is of no use. There are only TWO compliance officers in the entire city, which has grown from 53,000 to 285,000 in the last 12 years.

These TWO (hired only two years ago) are each assigned to a list of lenders. Their job is to constantly monitor the exterior condition of foreclosures by dealing with the lenders’ property managers to get pools emptied, weeds mowed, broken windows replaced, etc. 90% of these properties are in recently-annexed portions of CV where they were originally sold for way too much money during the “bubble.”

They care NOTHING about circa 1965 “grandfathered” garages and room additions built too close to property lines, dead trees (unless leaning on a neighbor’s roof), broken down fences, junk vehicles parked on private property, etc.

[bearishgurl]

[quote=CA renter]Perhaps that could be dealt with in some other fashion (code enforcement?).[/quote]

CA Renter, calling “Code Enforcement” is of no use. There are only TWO compliance officers in the entire city, which has grown from 53,000 to 285,000 in the last 12 years.

These TWO (hired only two years ago) are each assigned to a list of lenders. Their job is to constantly monitor the exterior condition of foreclosures by dealing with the lenders’ property managers to get pools emptied, weeds mowed, broken windows replaced, etc. 90% of these properties are in recently-annexed portions of CV where they were originally sold for way too much money during the “bubble.”

They care NOTHING about circa 1965 “grandfathered” garages and room additions built too close to property lines, dead trees (unless leaning on a neighbor’s roof), broken down fences, junk vehicles parked on private property, etc.

[bearishgurl]

[quote=CA renter]Perhaps that could be dealt with in some other fashion (code enforcement?).[/quote]

CA Renter, calling “Code Enforcement” is of no use. There are only TWO compliance officers in the entire city, which has grown from 53,000 to 285,000 in the last 12 years.

These TWO (hired only two years ago) are each assigned to a list of lenders. Their job is to constantly monitor the exterior condition of foreclosures by dealing with the lenders’ property managers to get pools emptied, weeds mowed, broken windows replaced, etc. 90% of these properties are in recently-annexed portions of CV where they were originally sold for way too much money during the “bubble.”

They care NOTHING about circa 1965 “grandfathered” garages and room additions built too close to property lines, dead trees (unless leaning on a neighbor’s roof), broken down fences, junk vehicles parked on private property, etc.

[briansd1]

bearishgurl, you make it sound like only people who can afford to maintain their properties to your standards should deserve to be homeowners.

What’s wrong with weeds and junk cars? If it doesn’t bother the owners, they are entitled to have them on their properties.

Property rights means that you have the right to maintain your property or let it decay and fall apart. That’s your right. Nobody can force you to earn the money then spend it to maintain your property (think of the two wood bungalows at La Jolla Cove).

[briansd1]

bearishgurl, you make it sound like only people who can afford to maintain their properties to your standards should deserve to be homeowners.

What’s wrong with weeds and junk cars? If it doesn’t bother the owners, they are entitled to have them on their properties.

Property rights means that you have the right to maintain your property or let it decay and fall apart. That’s your right. Nobody can force you to earn the money then spend it to maintain your property (think of the two wood bungalows at La Jolla Cove).

[briansd1]

bearishgurl, you make it sound like only people who can afford to maintain their properties to your standards should deserve to be homeowners.

What’s wrong with weeds and junk cars? If it doesn’t bother the owners, they are entitled to have them on their properties.

Property rights means that you have the right to maintain your property or let it decay and fall apart. That’s your right. Nobody can force you to earn the money then spend it to maintain your property (think of the two wood bungalows at La Jolla Cove).

[briansd1]

bearishgurl, you make it sound like only people who can afford to maintain their properties to your standards should deserve to be homeowners.

What’s wrong with weeds and junk cars? If it doesn’t bother the owners, they are entitled to have them on their properties.

Property rights means that you have the right to maintain your property or let it decay and fall apart. That’s your right. Nobody can force you to earn the money then spend it to maintain your property (think of the two wood bungalows at La Jolla Cove).

[Author]

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